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Flight to Quality in Manhattan creates feast for Class A, famine for Class B as absorption imbalance deepens

• From 2010 to 2017, Class A office product in Manhattan captured 15.8 million square feet of absorption, while Class B only saw 1.9 million square feet - a difference of almost 14 million square feet.

• This imbalance was exacerbated in 2017, as Class A clocked 4.2 Million square feet of positive absorption to Class B’s figure of -1.3 Million square feet.

• Office-using employment in Manhattan grew by 162,000 jobs, or 17.5%, between 2010 and 2017. With the labor market continuing to tighten, a growing emphasis on talent recruitment and retention has resulted in increased demand for high-quality office product at the expense of demand for commoditized space, emphasizing this ‘Tale of Two Markets’ phenomenon.

Source: JLL Research




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